But Anmuth said not to flee the stock. "The pullback in Twitter shares on Data Licensing concerns is overdone," he wrote, citing the way that Twitter actually handles user data.

As the EU is set to implement GDPR (General Data Protection Regulation) rules on May 25 this year, and the FTC investigates Facebook, social media companies may have to rethink how they use and sell highly sensitive personal data.

But Anmuth said that "Twitter’s application programmers interfaces simply make its already publicly available information more accessible." In short, Twitter simply makes data sharing easier for advertisers. It doesn't give those parties inside access to highly personal user data.

The JPMorgan note makes almost the same point about Twitter, and added that "Twitter doesn’t share any access to Direct Messages through its paid APIs," meaning that advertisers cannot see what Twitter users are writing in direct messages. And Twitter said in a statement Tuesday that "our data licensing business does not sell DMs."

The note did point out, as did Citron Research's note Tuesday, that Twitter's data licensing revenue grew in 2017, while advertising revenue fell.

Twitter's data liscencing revenue grew from $282 million in 2016 to $333 million in 2017, while ad revenue for the same period shrunk from $2.2 billion to $2.1 billion, according to its 2017 letter to shareholders. The JPMorgan note said data licencing was "likely 20%+ of EBITDA." Citron cited this as the reason Twitter is especially vulnerable to data regulation, a conclusion JPMorgan refuted, citing Twitter's reliance on non-sensitive data, rather than the sensitive data subject to regulation.

JPMorgan gave Twitter a $36 price target, with the stock hovering around $28 Wednesday. "TWTR’s execution is improving across both products and advertising, which we expect to drive 11% DAU growth in 2018 and accelerating revenue growth of 14%," the note said.